Canada Hotels Report Performance Gains in February

Why It Matters

The uptick signals a broader post‑pandemic recovery and growing pricing power for Canadian hotels, while divergent regional results highlight where demand is strongest and where operators may need to adjust strategies.

Key Takeaways

• Canada hotel RevPAR up 4.2% YoY, reaching $85.
• Manitoba posts 16% RevPAR growth, strongest nationwide.
• Vancouver occupancy climbs to 73.8%, RevPAR $122.
• Toronto ADR rises 7.2% to $170 despite occupancy drop.
• Industry shows modest occupancy rise, indicating recovery.

Pulse Analysis

The February 2026 CoStar report shows Canada’s hospitality market gaining momentum after two years of volatility. Occupancy nudged higher to 57.9% and ADR rose to roughly $146, pushing RevPAR to about $85. These modest but consistent gains suggest that leisure travel and domestic business trips are rebounding, supported by a stable macro‑economic environment and a weaker Canadian dollar that makes the country more attractive to foreign tourists.

Regional performance diverged sharply. Manitoba emerged as the standout, delivering a 16% RevPAR surge to $88, driven by limited new supply and strong demand from regional events and cross‑border visitors. Vancouver’s occupancy climbed to 73.8% and RevPAR hit $122, reflecting a tight hotel inventory and robust tourism from the Pacific Northwest. In contrast, Toronto’s occupancy fell 7.2% to 63.8%, yet its ADR jumped to $170, indicating that hotels are successfully shifting toward higher‑priced segments, possibly through premium branding or targeting corporate travelers.

For investors and operators, the data underscores both opportunity and risk. The overall upward trend validates continued capital allocation to Canadian assets, while the pronounced provincial gaps signal where strategic focus should lie—whether expanding capacity in high‑growth markets like Manitoba or enhancing yield management in price‑sensitive cities such as Toronto. Looking ahead, sustained demand will hinge on factors like labor availability, inflationary pressure on operating costs, and the pace of tourism recovery, making agile pricing and targeted marketing essential for maintaining momentum.